EPC/Energy Value Chain Integration: Project Finance and Development -
Tuesday, May 19th - Special Workshop
9th New Era in Oil, Gas and Power Value Creation - Federal Reserve Bank-Houston
Conference Center / University of Texas Facility
Crowne Plaza Houston - Downtown
We will pull together the previous presentations on Engineering, Procurement & Construction
(EPC) and Project Finance from the Project Developer's point of view and outline the essentials for
successfully developing oil, gas and power projects utilizing project financing and its required
"single point of responsibility" EPC contractor for the hard money (fixed price) component.
The essence of our presentation will address the following:
- When and why does EPC and Project Finance come together?
- Why is it necessary they do so in the oil & gas industry?
- What are all the potential stages of project development?
- What has not been addressed by previous EPC / Project Finance Presentations?
- What absolute skill sets must EPCs have to perform in a project financing?
- What is professional project management and project controls?
- What is the management triangle strongly recommended for O&G Projects?
- What are the tools of project finance that EPCs must follow?
- What is essentially missing in most FEED packages that cannot be in project finance?
- What is a Master Risk & Opportunity Register?
- Why is RISK ALLOCATION one of the most important issues?
- Linking with the EPC Case Study – Sea Breeze LNG Project 2007 – Your Case Study
- What’s transparent risk-based decision support packages in project development?
- Addressing RISKS in project development in emerging economies
- Risks in project finance structures, documentation, etc.
- A better approach – The Project Executive Group Project Development Methodology
Tuesday, May 19th - Special Workshop
9th New Era in Oil, Gas and Power Value Creation - Federal Reserve Bank-Houston
Conference Center / University of Texas Facility
Crowne Plaza Houston - Downtown
We will pull together the previous presentations on Engineering, Procurement & Construction
(EPC) and Project Finance from the Project Developer's point of view and outline the essentials for
successfully developing oil, gas and power projects utilizing project financing and its required
"single point of responsibility" EPC contractor for the hard money (fixed price) component.
The essence of our presentation will address the following:
- When and why does EPC and Project Finance come together?
- Why is it necessary they do so in the oil & gas industry?
- What are all the potential stages of project development?
- What has not been addressed by previous EPC / Project Finance Presentations?
- What absolute skill sets must EPCs have to perform in a project financing?
- What is professional project management and project controls?
- What is the management triangle strongly recommended for O&G Projects?
- What are the tools of project finance that EPCs must follow?
- What is essentially missing in most FEED packages that cannot be in project finance?
- What is a Master Risk & Opportunity Register?
- Why is RISK ALLOCATION one of the most important issues?
- Linking with the EPC Case Study – Sea Breeze LNG Project 2007 – Your Case Study
- What’s transparent risk-based decision support packages in project development?
- Addressing RISKS in project development in emerging economies
- Risks in project finance structures, documentation, etc.
- A better approach – The Project Executive Group Project Development Methodology
Meltdown Management in the E&C Industry
Rice Global Forum for Engineering & Construction Roundtable Luncheon
Rice University - Friday, July 10th
We are in "a perfect storm" in the Engineering & Construction industry. We're facing
meltdown of significant proportion with disappearing pipelines. This should not be
new information. You know this already if you are in it. What may be new
information; however, is how to manage in this strange and painful time...and still be
in business to talk about it in the aftermath.
To survive, you must know and apply Crisis Management and be proficient in troubled
company management (meaning turnaround and cash management), troubled project
management (meaning turnaround and time management skills with a true sense of
urgency), and "hard money" contracting (meaning At-Risk project reputation and
outstanding abilities). Credit markets have shifted from bank debt (banks have mostly
disappeared from the market). Debt providers now are institutional and private equity
with dry powder and no place to go!
There is significant dry powder (hundreds of $billions in cash available) sitting on the
sidelines waiting for investments in legitimate strategies and projects. However, this shift
in the market and economy are driving capital project development funding into the
realism of "hard money" at-risk contracting, true Net Present Value (NPV), and the
requirement to "earn the risk premium."
Corporate finance is under attack due to loss of credit lines, bank failures and loss of
lender relationships, not to mention the free-fall impact on publicly traded company's
stocks which have lost significant value with no end in site. Those who have existing
contracts will experience Clients who will require a significant cut in expenses, meaning
re-negotiation of contracts, shutdown of projects with little or no warning due to
crisis/cash management decisions, and other activities...non of which are good news to
the E&C industry. Some Clients will go bankrupt, impacting their freedom of
decisions...and possible existence.
Over the next two to three years (at least) those E&C companies that can provide
outstanding hard money capability and have the balance sheet to support this type of
EPC investment will do well or at a minimum...survive! Reimbursable engineering will now
be required to be in hard money terms.
The world of structured finance is still viable for good projects. Those that can and do
At-Risk projects either as Lump Sum Turn Key (LSTK) or Design-Build will be the survivors,
with the caveat they have the management skills to button up risks AND the interests,
ability and willingness to provide financing support. "Skin in the game" will become a
requirement, not an option, for E&C players.
EPC Contractors who will entertain Build-Own-Operate (BOO),
Build-Own-Operate-Transfer (BOOT), or Build-Own-Transfer (BOT) or variation thereof, will
survive the downturn since THAT is where the work will be. The EPC contractor must be
prepared to assist clients in financing their projects to get them off dead center or out of
shutdown mode. An example is sweat equity play with engineering thus positioning as
sole Point of Responsibility to lenders and owners for the construction hard money Total
Installed Cost (TIC) contract.
Paul Allen is a co-founder and board member of the Rice Global Forum for E&C
Rice Global Forum for Engineering & Construction Roundtable Luncheon
Rice University - Friday, July 10th
We are in "a perfect storm" in the Engineering & Construction industry. We're facing
meltdown of significant proportion with disappearing pipelines. This should not be
new information. You know this already if you are in it. What may be new
information; however, is how to manage in this strange and painful time...and still be
in business to talk about it in the aftermath.
To survive, you must know and apply Crisis Management and be proficient in troubled
company management (meaning turnaround and cash management), troubled project
management (meaning turnaround and time management skills with a true sense of
urgency), and "hard money" contracting (meaning At-Risk project reputation and
outstanding abilities). Credit markets have shifted from bank debt (banks have mostly
disappeared from the market). Debt providers now are institutional and private equity
with dry powder and no place to go!
There is significant dry powder (hundreds of $billions in cash available) sitting on the
sidelines waiting for investments in legitimate strategies and projects. However, this shift
in the market and economy are driving capital project development funding into the
realism of "hard money" at-risk contracting, true Net Present Value (NPV), and the
requirement to "earn the risk premium."
Corporate finance is under attack due to loss of credit lines, bank failures and loss of
lender relationships, not to mention the free-fall impact on publicly traded company's
stocks which have lost significant value with no end in site. Those who have existing
contracts will experience Clients who will require a significant cut in expenses, meaning
re-negotiation of contracts, shutdown of projects with little or no warning due to
crisis/cash management decisions, and other activities...non of which are good news to
the E&C industry. Some Clients will go bankrupt, impacting their freedom of
decisions...and possible existence.
Over the next two to three years (at least) those E&C companies that can provide
outstanding hard money capability and have the balance sheet to support this type of
EPC investment will do well or at a minimum...survive! Reimbursable engineering will now
be required to be in hard money terms.
The world of structured finance is still viable for good projects. Those that can and do
At-Risk projects either as Lump Sum Turn Key (LSTK) or Design-Build will be the survivors,
with the caveat they have the management skills to button up risks AND the interests,
ability and willingness to provide financing support. "Skin in the game" will become a
requirement, not an option, for E&C players.
EPC Contractors who will entertain Build-Own-Operate (BOO),
Build-Own-Operate-Transfer (BOOT), or Build-Own-Transfer (BOT) or variation thereof, will
survive the downturn since THAT is where the work will be. The EPC contractor must be
prepared to assist clients in financing their projects to get them off dead center or out of
shutdown mode. An example is sweat equity play with engineering thus positioning as
sole Point of Responsibility to lenders and owners for the construction hard money Total
Installed Cost (TIC) contract.
Paul Allen is a co-founder and board member of the Rice Global Forum for E&C
Presentations - 2011
None scheduled at this time.
Presentations - 2010
Nomads at the HESS Building - Aug 2010 - See Past Presentations
Presentations - 2009
Crisis Executive Management in Troubled Times...Like NOW!
Friday, May 15th - Breakfast Presentation 0730-0930
Friday Forum
IBC Bank - 5615 Kirby, 2nd Flr Community Room
Presentation will address Crisis Executive Management in Troubled Times – like NOW! By
definition, a crisis is a major, unpredictable event that threatens to harm an organization and its
stakeholders. Although crisis events are unpredictable, they are not unexpected (Coombs, 1999).
Crises can affect all segments of society and are caused by a wide range of reasons. Although the
definitions can vary greatly, three elements are common to most definitions of crisis: (a) a threat
to the organization, (b) the element of surprise, and (c) a short decision time (Seeger, Sellnow &
Ulmer, 1998).
Presentation Summary
We are all facing a great deal of uncertainty and crisis in 2009. Where we DO NOT need it is in
projects, especially when those projects are implementations of organizational strategies needed
in troubled times! Strategy execution is a well-established area of failure for most organizations.
Complacency is NOT acceptable and a false sense of urgency is NOT the cure. Strategy execution
requires timely results, not excuses. Timely and outstanding strategy execution is delivered
through projects using exceptional project management with an appreciation of TIME! Due to
survival in 2009, organizations can no longer tolerate failed projects and NPV destruction. Where
NPV is important, a true sense of urgency must exist.
None scheduled at this time.
Presentations - 2010
Nomads at the HESS Building - Aug 2010 - See Past Presentations
Presentations - 2009
- May 15 - Friday Forum
- May 19 - 9th ERA Oil, Gas & Power Value Creation - Special Workshop
- July 10 - Rice Global Forum for Engineering & Construction
Crisis Executive Management in Troubled Times...Like NOW!
Friday, May 15th - Breakfast Presentation 0730-0930
Friday Forum
IBC Bank - 5615 Kirby, 2nd Flr Community Room
Presentation will address Crisis Executive Management in Troubled Times – like NOW! By
definition, a crisis is a major, unpredictable event that threatens to harm an organization and its
stakeholders. Although crisis events are unpredictable, they are not unexpected (Coombs, 1999).
Crises can affect all segments of society and are caused by a wide range of reasons. Although the
definitions can vary greatly, three elements are common to most definitions of crisis: (a) a threat
to the organization, (b) the element of surprise, and (c) a short decision time (Seeger, Sellnow &
Ulmer, 1998).
Presentation Summary
We are all facing a great deal of uncertainty and crisis in 2009. Where we DO NOT need it is in
projects, especially when those projects are implementations of organizational strategies needed
in troubled times! Strategy execution is a well-established area of failure for most organizations.
Complacency is NOT acceptable and a false sense of urgency is NOT the cure. Strategy execution
requires timely results, not excuses. Timely and outstanding strategy execution is delivered
through projects using exceptional project management with an appreciation of TIME! Due to
survival in 2009, organizations can no longer tolerate failed projects and NPV destruction. Where
NPV is important, a true sense of urgency must exist.
Project Executive Group
 | |  | |  | |  | |  | |  | |  | |  | |  | |  | |  |
| GET TO KNOW OUR TEAM |
| © Copyright 2001-2011 Project Executive Group, Inc. All rights reserved. |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
"The test of an organization is the spirit of performance." - Peter Drucker
| HOME |
Project Executive Group
1330 Post Oak Blvd., #1600
Houston, TX 77056 USA
info@projectexecutive.com
Tel: 713-591-3757
1330 Post Oak Blvd., #1600
Houston, TX 77056 USA
info@projectexecutive.com
Tel: 713-591-3757
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
| The Project Pit Stop Visit / Follow our BLOG |
| Helping you on your drive to Performance and Success! |